Bill to bring order to marine economy…

November 2017 ParlyReport…..

In the light of President Zuma’s emphasis in his recent speeches on oil and gas issues, it is important to couple this in terms of government policy with the tabling of the section 76 Marine Spatial Planning Bill (MSP Bill). The proposals are targeted at business and industry to establish “a marine spatial planning system” offshore over South African waters.

The Bill also says it is aimed at “facilitating good ocean governance, giving effect to South Africa’s international obligations.”

A briefing by the Department of Environmental Affairs (DEA) on their proposals is now awaited in Parliament. The Bill until recently was undergoing controversial hearings in the provinces as is demanded by its section 76 nature.

Water kingdom

The MSP Bill applies to activities within South Africa’s territorial waters known as Exclusive Economic Zones, which are mapped out areas with co-ordinates within South Africa’s continental shelf claim and inclusive of all territorial waters extending the Prince Edward Islands.

The Bill flows, government says, from its Operation Phakisa plan to develop South Africa’s sea resources, notably oil and gas. The subject has recently been subject to hearings in SA provinces that have coastal activities. This importantly applies to South African and international marine interests operating from ports in Kwa-Zulu Natal and the Eastern and Western Cape but also involves coastal communities and their activities.

International liaison

Equally as important as maritime governance, is the wish to assist in job creation by letting in work creators. Accounted for also are international oceanic environmental obligations to preserve nature and life supporting conditions which DEA state can in no way can be ignored if maritime operations and industrial seabed development are to be considered.

South Africa is listed as a UNESCO participant, together with a lengthy list of other oceanic countries, agreements which, whilst not demanding total compliance on who does what, are in place to establish a common approach to be respected by oceanic activity, all to be agreed in the 2016/7 year. South Africa is running late.

Invasion protection

Whilst the UNESCO discipline covers environmental aspects and commercial exploitation of maritime resources, the MSP Bill now before Parliament states that in acknowledging these international obligations, such must be balanced with the specific needs of communities, many of whom have no voice in an organised sense.

As Operation Phakisa has its sights set on the creation of more jobs from oceanic resources therefore, the MSP Bill becomes a balancing act for the Department of Environmental Affairs (DEA) and the Bill is attracting considerable interest as a result.

The hearings in the Eastern Cape have already exposed the obvious conundrum that exists between protecting small-time fishing interests and community income in the preservation of fishing waters and development of undersea resources. What has already emerged that the whole question of the creation of future job creation possibilities from seabed-mining, oil and gas exploration and coastal sand mining is not necessarily understood, as has been heard from small communities.

The ever present dwindling supply of fish stocks is not also accepted in many quarters, with fishing quotas accordingly reduced.

Tug of war

All views must be considered nevertheless but from statements made at the political top in Parliament it becomes evident that the potential of developing geological resources far outweigh the needs of a shrinking fishing industry. At the same time, politicians usually wish to consider votes and at parliamentary committee level, the feedback protestfrom the many localised hearings is being heard quite loudly.

As one traditional fishing person said at the hearings in the Eastern Cape, “The sea is our land but we can only fish in our area to sustain life. The law is stopping us fishing for profit.”

Local calls

The attendees at many hearings have said that the MSP Bill and similar regulations in force restrict families from earning from small local operations such as mining sand; allow only limited fishing licences and call for homes to be far from the sea denying communities the right to benefit from the sea and coastal strips for a living.

Hearings last went to the West Coast and were held with Saldanha Bay communities.

Big opportunities

Conversely, insofar as Operation Phakisa is concerned, President Zuma, as has been stated, said clearly in his latest State of Nation Address that government has an eye for much more investment into oil and gas exploration. He has since announced that there are plans afoot to drill at least 30 deep-water oil and gas exploration wells within the next 10 years as part of Operation Phakisa.

Coupled to this is the more recent comment in Parliament that once viable oil and gas reserves are found, the country could possibly extract up to 370 000 barrels of fossil fuels each day within 20 years – the equivalent of 80% of current oil and gas imports.

According to the deadline set by the Operation Phakisa framework, the MSP Bill should have been taken to Parliament at the beginning of December 2016 for promulgation as an Act by the end of June 2017, making it appear that things are running late.

Environmental focus

As the legislation is environmentally driven, with commercial interests coming to the surface in a limited manner at this stage, the matter is being handled by the Portfolio Committee on Environmental Affairs. It is understood that later joint meetings will be held with the Trade and Industry Committee and with Energy Committee members.

Adding to the picture that is now beginning to emerge, is the fact that Minister of Science and Technology, Naledi Pandor, has signed a MOU with the Offshore Petroleum Association of South Africa.

Minister Pandor said at the time of signing, “The South African coastal and marine environment is one of our most important assets. Currently South Africa is not really deriving much from the ocean’s economy. This is therefore why we want to build a viable gas industry and unlock the country’s vast marine resources.”

Moves afoot

OPASA is now to make more input with offshore oil and gas exploration facts and figures. Energy publications are now bandying figures around that developments in this sphere will contribute “about R20bn to South Africa’s GDP over a five-year period.” If this is the case, the Energy Minister might be compromised once again, as she was with renewables, on the future makeup of the planned energy mix.

Amongst the particularly worrying issues raised by opposition parliamentarians and various groupings in agricultural and fishing areas is that there is a proposal in the MSP Bill on circuit states that the Act will trump all other legislation when matters relate to marine spatial planning. DEA will have to answer this claim.

Opposition

Earthlife Africa have also stated at hearings in Richards Bay that in their opinion “Operation Phakisa has very little to do with poverty alleviation and everything to do with profits for corporates, most likely with the familiar kickbacks for well-connected ‘tenderpreneurs’ and their political allies.”

This is obviously no reasoned argument and just a statement but gives an indication of what is to be faced by DEA in the coming months.

Giants enter

With such diverse views being expressed on the Bill, President Zuma and past Minister of Energy, Mmamaloko Kubayi cannot have missed the announcement that Italy’s Eni and US oil and gas giant, Anadarko, have signed agreements with the Mozambique government to develop gas fields and build two liquefied natural gas terminals on the coast to serve Southern African countries.

Eni says it is spending $8bn to develop the gas fields in Mozambique territorial waters and Anadarko is developing Mozambique’s first onshore LNG plant consisting of two initial LNG trains with a total capacity of 12-million tonnes per annum. More than $30bn, it has been stated in a joint release by those companies, is expected to be invested in Mozambique’s natural gas sector in the near future.

Impetus gaining

In general, therefore, the importance of a MSP Bill is far greater than most have realized. The vast number of countries called upon to have their MSP legislation in place also indicates international pressure for the Portfolio Committee on Environmental Affairs to move at speed.

This follows a worldwide shift to exploiting maritime resources, an issue not supported by most enviro NGOs and green movements without serious restrictions. Most parliamentary comments indicate that the trail for oil and gas revenues needs following up and the need to create jobs in this sector is even greater.

Ground rules

Whilst the oil and gas industry and the proponents of Operation Phakisa also recognize that any form of MSP Bill should be approved to provide gateway rules for their operations and framework planning, the weight would seem to be behind the need for clarity in legislation and urgency in implementation of not only eco-friendly but labour creating legislation.

Operation Phakisa, as presented to Parliament particularly specified that the development of MSP legislation was necessary and Sean Lunn, chairperson of OPASA has said that the Bill will “add tangible value to South Africa’s marine infrastructure, protection services and ocean governance.” He said it will go a long way in mitigating differences between the environmentalists and developers.

Not so nice

On seabed mining, the position with the MSP Bill is not so clear, it seems. Saul Roux for the Centre for Environmental Rights (CER) says that the Department of Mineral Resources granted a few years ago three rights to prospect for marine phosphates.

He also stated that the marine process “involves an extremely destructive form of mining where the top three metres of the seabed is dredged up and consequently destroys critical, delicate and insufficiently understood sea life in its wake.” Phosphates are predominantly used for agricultural fertiliser.

“These three rights”, he said “extend over 150,000 km2 or 10% of South Africa’s exclusive economic zone.”

Something happening

One of CER’s objectives, Roux says, is to have in place a moratorium on bulk marine sediment mining in South Africa. He complains that despite the three mining rights having been gazetted, he cannot get any response from Minister of Mineral Resources, Mosebenzi Zwane, or any access to any documents on the subject.

He stated there were two South African companies involved in mining sea phosphates and one international group, these being Green Flash Trading 251, Green Flash Trading 257 and Diamond Fields International, a Canadian mining company. All appeared to be interested in seabed exploration for phosphates although not necessarily mining itself.

Roux called for the implementation of an MSP Bill which specifically disallowed this activity as is the case in New Zealand, he said.

Coming your way

The MSP Bill was tabled in April 2017 and once provincial hearings are complete it will come to Parliament. The results of these hearings will be debated and briefings commenced when announced shortly.

All on climate change but not cost…

Almost always ignored at the recent parliamentary public hearings on the SA COP21 climate change submission was the issue of finances, probably the essential ingredient that should have been debated as part of South Africa’s position in the forthcoming conference in Paris on intended targets for reduction of greenhouse gases.

After two full days of submissions, with no time for committee member questions from MPs in the light of time restraints and the re-presentation of papers in Xhosa, an impression was gained that there remained the same sharp divide between the providers of statistics that clearly showed what a future world would look like if South Africa and other countries continued on existing paths and those who called for reality in the light of the fact that South Africa is a coal-based economy and will remain so well into the mid-century.

State developmental call only

Surprisingly costs to the tax payer and to business and industry featured little in the proposed department of environmental affairs (DEA) COP22 submission, other than by emphasing the point by investing sooner was a more advantageous position to be in than later, when the cost of “catch up” would be far greater.

The submission is to be South Africa’s call on implementing their portion of 2015 COP agreement from its Green Climate Fund and which reserve fund is supposed to be capable of mobilising $100bn from 2020 onwards. Also to be resolved is the issue of the immediate sources of funds and to capitalize into reality for use what already exists in the fund.

Maverick viewpoint

The one person who did approach the issue of funds but who fell into the category of a “denialist” according to environmental observers, was Prof. Phillip Lloyd of the Energy Institute, Cape Peninsular Institute of Technology, a known detractor of climate change.

He claimed that in fact climate change issues represented a massive multi-billion industry with a potential turnover of R1,174bn. It was staffed by thousands of NGOs around the world, he said, employees of sensitive international companies, whole government departments and enormous amount of diverted funds that could be put to better use.

He claimed that the current warnings on climate change and “doomsday scenarios” were largely based on unsubstantiated statistics, or at the very least, exaggerated claims. Such funds should be diverted to development, not wasted on pointless conferences, he stated, and technologies that could not hope to meet the demands of growing populations.

Fact or fiction

He showed a graph of rainfall records for England and Wales going back to AD 1750 which indicated a mere 4% rise over the entire period and whilst indeed CO2 emissions , according to him, had increased alarmingly affecting health this was in no way connected to climate change because temperatures had only increased 1%, part of a long process of global warming that went back to the globe’s emergence from the last Ice Age.

Similarly, he noted, rising sea levels had been going on for “thousands of years” but the current level of annual sea rise was dropping in terms of archaeological and geological studies conducted, again over the centuries. He said that the current spend globally on the whole so-called climate change awareness programmes and infrastructure spend amounted to some R15,500 per person globally and “sooner or later this hype had to come to an end”, he concluded.

The chairperson thanked Prof. Lloyd with a sense of amusement.

Developmental help

Another issue raised regularly regarding the DEA COP 21 submission hearings was the call for capacity building to handle new clean energy resources, a major problem in many developing countries. Financial and technology mechanisms had to be shared and adapted wherever possible, particularly in countries where forced change would stunt economic growth, the paper before them stated.

Most submissions focused on the fact that the two issues had to be in harmony but few could expand how this could be achieved successfully, some submissions just taking the “green at all costs” approach. Nevertheless, in broad terms, all submission except the one acknowledged the urgent need for some sort of structured approach to the agreed need for climate change programmes.

Most submissions also made reference to the activities of Eskom or Sasol in one way or another, referring to such in one case as “the primary polluters in the South African context”. Subjects brought up varied from fracking to small enterprise farming and renewable energy supplies to carbon capture.

In the one corner….

Greenpeace maintained that listing nuclear energy as “low-carbon” option was disingenuous in that nuclear life cycle in itself was carbon intensive and should not be referred as an energy component for clean renewable alternatives and preferably removed altogether.

Other predictable submissions came fromsuch bodies as Earthlife Africa and the World Wildlife Fund, who specifically named fossil fuels as the major problem, one of the few times vehicle fuel emissions were mentioned in the two days.

COSATU complained that the use of nuclear energy did not create jobs and would not help the economy in any way but did raise the issue that the effect of global warming was a fact and would be ”devastating as far as employment was concerned”.

The legal view

The Centre for Environmental Rights(CER) stated that South Africa’s negotiating position at COP 21 should succeed in giving effect to section 24 of the Constitution regarding the right to health but they complained that DEA’s long term plans, which included accommodating coal-fired power generation and its highly water-intensive processes had no hope of meeting constitutional requirements unless urgent changes were made.

They pointed out that aside from Medupi and Kusile, the Minister of Energy’s plan to procure an additional 2500MW of coal fired power included seven further coal-fired plants yet to be built and which were in the planning stage, mostly in Limpopo and Mpumalanga. Both these provinces, CER said, were highly water stressed areas and had zones already declared as health priority areas due to poor air quality.

Even the right of access to drinking water was threatened in these areas, they pointed out, both issues, air pollution and lack of drinking water in their view representing potential breaches of constitutional privilege.

Top down problems

A number of interesting submissions were made on the problem of local government implementation of climate change mitigation plans. A particularly important submission came from SA Local Government Association (SALGA), who pointed to the fact that whilst climate change was a national issue and called for a national approach, this did not change the fact that implementation and controls, regulations and planning mostly had to be done by cities and municipalities.

SALGA said there seemed to be no cohesion either in funding or in policy between national government and to some extent provincial government, but certainly not with local governmental authorities. They called for an “enabling framework” that could be adopted in key localised areas and so that “the voice of local government could be heard” by those paying for it.

Methane and fracking

A scientific paper known as the Howarth Report, emanating from Cornell University, was presented by a private individual, Marilyn Lilley, which focused on hydraulic fracturing and the greenhouse gas footprint left by this fracking drilling, the Howarth Report specifically focusing of fracking in the United States of America. Ms Lilley related these findings in her presentation with that of the 200,000sq km area released for fracking ventures in the Karoo.

A quick read of the Howarth Report indicates that in the US during the life cycle of an average shale-gas well 3.6 to 7.9% of the total production of the well is emitted as methane gas. This is at least 30% more and twice the harmful effect as gas extracted from conventional oil wells, the report says.

Also there is a 1.4% leakage of methane during storage and transmission of shale gas. This is the far the most dangerous component of greenhouse gases, the average black smoke emitted from a factory containing on the whole mainly harmless soot, the report concludes. Ms Lilley said that methane was “enemy number one”, adding again that methane had a far greater effect on global warming than any amount of coal fired energy generation.

Methane spouts

She also said that during the hydraulic fracturing stage of a drilling, which would go to at least 3-4kms vertically to a shale layer and then for approximately 2kms horizontally along the seam, fracturing then takes place with explosives and some 20 million litres of water with silica sand and chemicals pumped in to cause the methane gas to return to the surface with the then toxic water.

She said well pads are usually built 3-4 kms apart in a grid formation and each pad can have up to 30 wells, each being capable of being fracked a number times and each frack taking about 20 million litres of water.

She concluded that fracking whilst be making an unpleasant major contribution to greenhouse gas emissions, the process rather contributed more to global warming which was the actual root problem. She called for fracking and consequent methane gas emissions to be accounted for in South Africa’s COP 21 submission as a subject in itself and for a moratorium to be declared on fracking exploration and subsequent gas extraction.

She also pointed to the fact that disposing of the then toxic water extracted, in some cases needing irradiation, would become an immense and unmanageable waste problem and the light of the distances involved in the South African scenario.

Agri-plans and consequent food processing development

A considerable number of submissions focused on the importance of establishing viable small farming units and a completely self-sustaining mini-agricultural food industry in specially located zones. The proposers suggested suitable cropping of vegetables and staple foods in order preserve the food chain for poorer communities under climate change conditions, the zones themselves contributing to healthier emissions with normal synthesis.

Carbon capture investigation

The South African National Energy Institute (SANEDI), reporting to the Central Energy Fund, gave a report- back on their work in the South Eastern Cape where a pilot drilling project, carried out on-shore for reasons of cost, was exploring the possibility of large-scale carbon storage at sea. Prof. AD Surridge described carbon emissions capture as part of the “weaning off process necessary” whilst the country moved slowly from a fossil fuel based economy to a renewables/nuclear mix.

This pilot storage plant should be running by 2016, SANEDI said, and “commercial rollout possibilities concluded by 2020”.

Marathon run

In closing, Jackson Mthembu, chairperson of the Environmental Affairs Parliamentary Committee, said that “in South Africa, we are known for differing with respect”. This had been the purpose of the hearings, he pointed out.

He concluded by saying that climate change, as an issue, cut across all facets of government and consequently the parliamentary submissions collective summation would be shared across the desks of all Ministries involved.

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